DoD Awards Northrop Grumman $133M for Special Ammunition and Weapons Systems
Contract Overview
Contract Amount: $133,445,277 ($133.4M)
Contractor: Northrop Grumman Systems Corporation
Awarding Agency: Department of Defense
Start Date: 2024-09-27
End Date: 2026-02-28
Contract Duration: 519 days
Daily Burn Rate: $257.1K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 2
Pricing Type: FIRM FIXED PRICE
Sector: Defense
Official Description: SPEECIAL AMMUNINTION AND WEAPONS SYSTEMS REQUIREMENTS
Place of Performance
Location: RADFORD, RADFORD CITY County, VIRGINIA, 24141
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $133.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION for work described as: SPEECIAL AMMUNINTION AND WEAPONS SYSTEMS REQUIREMENTS Key points: 1. Significant contract value of $133.4M awarded to a major defense contractor. 2. Competition method was 'Full and Open', suggesting a potentially competitive bidding process. 3. Risk is moderate, given the specialized nature of ammunition and weapons systems. 4. Spending falls within the Defense sector, a high-priority area for government expenditure.
Value Assessment
Rating: good
The contract value of $133.4M for specialized ammunition and weapons systems appears reasonable given the scope and duration. Benchmarking against similar DoD contracts for advanced munitions would provide further context on pricing efficiency.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded under 'Full and Open Competition', indicating that multiple bidders were likely considered. This method generally promotes competitive pricing and ensures the government receives the best value.
Taxpayer Impact: The competitive nature of the award suggests taxpayers are likely benefiting from a fair price for these critical defense assets.
Public Impact
Ensures readiness and capability for U.S. Army operations. Supports advanced manufacturing and technological development in the defense industry. Contributes to the supply chain for essential military equipment.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Potential for cost overruns in complex weapons systems development.
- Supply chain disruptions impacting delivery timelines.
- Technological obsolescence of munitions over time.
Positive Signals
- Awarded under full and open competition.
- Firm Fixed Price contract type limits cost uncertainty.
- Long-term contract duration provides program stability.
Sector Analysis
This contract falls within the defense manufacturing sector, specifically focusing on specialized ammunition and weapons systems. Spending benchmarks for this niche area are highly variable, dependent on technological complexity and quantity.
Small Business Impact
While the primary awardee is a large corporation, the contract may indirectly benefit small businesses through subcontracts for components or specialized services. Further analysis would be needed to determine the extent of small business participation.
Oversight & Accountability
The Department of Defense's contracting processes typically involve multiple layers of oversight, including contract closeout and performance reviews. The specific oversight mechanisms for this contract would be detailed in the award documentation.
Related Government Programs
- Ammunition (except Small Arms) Manufacturing
- Department of Defense Contracting
- Department of the Army Programs
Risk Flags
- Contract duration extends beyond one year.
- Specialized nature of the product may limit competition.
- Potential for cost growth despite FFP due to unforeseen technical challenges.
- Reliance on a single large contractor for critical defense assets.
Tags
ammunition-except-small-arms-manufacturi, department-of-defense, va, delivery-order, 100m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $133.4 million to NORTHROP GRUMMAN SYSTEMS CORPORATION. SPEECIAL AMMUNINTION AND WEAPONS SYSTEMS REQUIREMENTS
Who is the contractor on this award?
The obligated recipient is NORTHROP GRUMMAN SYSTEMS CORPORATION.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Army).
What is the total obligated amount?
The obligated amount is $133.4 million.
What is the period of performance?
Start: 2024-09-27. End: 2026-02-28.
What is the specific type of ammunition and weapons system being procured, and how does its technological sophistication impact cost?
The specific type of ammunition and weapons system is not detailed in the provided data, identified only by NAICS code 332993 (Ammunition (except Small Arms) Manufacturing). The technological sophistication is a key driver of cost in defense procurement. Advanced, precision-guided munitions or novel weapon platforms inherently require significant R&D investment, specialized materials, and rigorous testing, leading to higher per-unit costs compared to conventional ordnance.
What are the primary risks associated with the long-term delivery schedule (2026) for these specialized systems?
The primary risks associated with the long-term delivery schedule include potential supply chain disruptions for critical components, inflationary pressures impacting material and labor costs, and the risk of technological obsolescence if battlefield requirements evolve rapidly. Furthermore, extended timelines can increase the likelihood of unforeseen geopolitical events or changes in defense strategy that might affect the need for these specific systems.
How does the 'Firm Fixed Price' contract type mitigate financial risks for the government in this procurement?
The 'Firm Fixed Price' (FFP) contract type significantly mitigates financial risks for the government by establishing a ceiling price that is not subject to adjustment based on the contractor's cost experience. This contract structure incentivizes the contractor to manage costs efficiently and complete the work within the agreed-upon budget. Any cost overruns incurred by Northrop Grumman would be absorbed by the contractor, protecting the government from unexpected increases in expenditure.
Industry Classification
NAICS: Manufacturing › Other Fabricated Metal Product Manufacturing › Ammunition (except Small Arms) Manufacturing
Product/Service Code: AMMUNITION AND EXPLOSIVES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY
Offers Received: 2
Pricing Type: FIRM FIXED PRICE (J)
Evaluated Preference: NONE
Contractor Details
Parent Company: Northrop Grumman Corporation
Address: 415 CONSTITUTION RD BLDG 229, RADFORD, VA, 24141
Business Categories: Category Business, Corporate Entity Not Tax Exempt, Manufacturer of Goods, Not Designated a Small Business, Special Designations, U.S.-Owned Business
Financial Breakdown
Contract Ceiling: $133,445,277
Exercised Options: $133,445,277
Current Obligation: $133,445,277
Subaward Activity
Number of Subawards: 3
Total Subaward Amount: $121,375,450
Contract Characteristics
Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED
Cost or Pricing Data: NOT OBTAINED - WAIVED
Parent Contract
Parent Award PIID: W52P1J22D0006
IDV Type: IDC
Timeline
Start Date: 2024-09-27
Current End Date: 2026-02-28
Potential End Date: 2026-02-28 12:02:00
Last Modified: 2024-12-19
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